India’s capital markets could be entering another multi-year growth phase as household savings move from cash and deposits into financial assets, according to Macquarie. The brokerage expects India’s investment, wealth and exchange revenue pool to expand at around 16% annually through FY30, creating a larger opportunity for digital brokers and market infrastructure companies.
In its September 24 report, India Capital Markets: A Powerful $500bn Flywheel, Macquarie said nearly 50% of India’s financial household savings remain in cash and deposits. It expects this pool to increasingly shift towards market-linked products, supporting a 16% compound annual growth rate in the combined investment and wealth and exchange revenue pool between FY26 and FY30.
Macquarie has initiated coverage on five capital-market companies. It rates Billionbrains Garage Ventures (Groww), Multi Commodity Exchange of India (MCX), BSE and National Stock Exchange of India (NSE) as ‘Outperform’, while Angel One is rated ‘Neutral’. Its target prices imply potential returns of 37% for Groww, 17% for MCX, 24% for BSE and 10% for NSE.
India’s $500 bn savings pool is the bigger opportunity
Macquarie’s central thesis is that India’s capital-market growth is moving beyond the initial digital-access phase. The brokerage sees three mutually reinforcing drivers: financialisation, equitisation and productisation.
“Financialisation expands the pool of savings entering formal products. Equitisation increases direct and indirect allocations to equities. Productisation raises engagement and wallet share by providing customers with more ways to invest, trade, save and manage wealth,” Macquarie said.
The brokerage expects India’s investment and wealth revenue pool to increase from Rs 1.2 lakh crore in FY26 to around Rs 2.2 lakh crore by FY30, implying a 16% CAGR. Retail broking is expected to grow at around 17%, while asset management and mutual fund distribution together form 44% of the current wallet and are expected to grow at around 16%.
Macquarie also expects India’s exchange revenue pool to grow at around 12-14% through FY30, with transaction revenue growing around 12% and non-transaction products growing around 15%. The brokerage said the broader mix of data, connectivity, listings and index-linked monetisation should reduce the industry’s dependence on trading volumes.
Retail participation still has a long runway
India’s capital-market penetration remains low despite the rapid expansion seen since the pandemic. The country’s demat account base rose from 21 million in FY13 to around 225 million by FY26, implying a 33% CAGR between FY20 and FY26. NSE’s active-client base grew at around 27% CAGR between FY17 and FY26.
Macquarie said only around 3% of India’s population is active on NSE, while around 4% owns mutual funds. Average daily cash-market turnover is only around 0.2% of market capitalisation, compared with 1.6% in the US and 2.8% in China.
The brokerage said India’s investor funnel shows a much larger potential market. As of FY26, the country had more than 600 million PAN cardholders and around 500 million active UPI users, but only around 45 million stock investors and 60 million mutual fund investors.
The growing middle and affluent population could further support this transition. Macquarie expects the middle-income segment to account for 47% of India’s population by FY31, up from 31% in FY21, while the affluent segment is projected to rise to 11% from 4%.
Groww has the highest target upside
Billionbrains Garage Ventures, the parent of Groww, is Macquarie’s preferred stock in its capital-markets coverage, with an ‘Outperform’ rating and a target price of Rs 260. Based on the brokerage’s valuation table, this represents a potential return of 37%.
Macquarie expects Billionbrains Garage Ventures to benefit from its customer-acquisition engine, cross-selling opportunities and margin expansion. It forecasts 25% revenue CAGR between FY26 and FY30, with EBITDA margins rising towards 70%.
“GROWW is our preferred broker, supported by its customer-acquisition engine, cross-sell opportunity, margin-expansion runway and free-cash-flow potential,” Macquarie said.
The brokerage expects Groww’s free cash flow to rise sharply as the business scales. Its stock-picking framework gives Groww the highest score among the five companies at 24, with strong scores for share gains, market position, platform diversification and margin expansion potential.
Macquarie estimates Groww’s EBITDA margin could rise from 59.1% in FY26 to 69.8% by FY30, while return on equity is projected at around 25% in FY27.
BSE combines market-share gains with new revenue streams
BSE carries an ‘Outperform’ rating from Macquarie with a target price of Rs 4,000, implying a potential return of 24%. The brokerage expects BSE to gain share in cash equities and futures and options while also expanding non-transaction revenue.
“BSE is a share gainer in a 12% TAM CAGR market, driving 16% FY26-30E revenue growth and margins toward 70%,” Macquarie said.
The brokerage expects BSE’s EBITDA margin to increase from 65.7% in FY26 to 69.6% by FY30. It also sees return on equity at around 41% in FY27.
Macquarie said the recent Closing Auction System is a near-term drag, but sees additional opportunities from self-clearing, securities or other product initiatives and non-transaction revenue. Its target price of Rs 4,000 is based on 40 times FY29 earnings per share.
MCX gets a 17% target return as commodity participation expands
Multi Commodity Exchange of India has been assigned an ‘Outperform’ rating with a target price of Rs 3,820, implying a potential return of 17%, according to Macquarie.
Macquarie expects MCX to benefit from its near-monopoly position in commodity derivatives and the relatively low penetration of commodity investing in India. The brokerage forecasts a 19% revenue CAGR for MCX between FY26 and FY30.
“MCX is India’s near-monopoly commodity exchange, under-penetrated on investors, products and volumes, with a 19% FY26-30E revenue CAGR from broadening participation,” Macquarie said.
The brokerage expects MCX’s EBITDA margin to remain around 71.5% through FY30, while return on equity is estimated at 47% in FY27. Macquarie values the exchange at 40 times FY29 earnings per share and said the market continues to underprice its platform optionality and cash-return potential.
NSE remains the largest market infrastructure play
National Stock Exchange of India has also received an ‘Outperform’ rating from Macquarie, with a target price of Rs 1,965. The brokerage’s target implies a potential return of 10%.
Macquarie expects NSE revenue to grow at 12% between FY26 and FY30, broadly in line with its estimate for the overall exchange revenue pool. It sees potential from new products, non-transaction revenue and further financialisation of India’s investor base.
“NSE is the lynchpin for India’s financialisation, with steady growth, margins and cash generation,” Macquarie said.
The brokerage expects NSE’s EBITDA margin to remain around 77% through FY30, with return on equity estimated at 35% in FY27. Its target price of Rs 1,965 is based on 32.5 times FY29 earnings per share.
Angel One gets ‘Neutral’ as regulation weighs on margins
Angel One is the only company among Macquarie’s five-stock coverage universe that does not carry an ‘Outperform’ rating. The brokerage has assigned a ‘Neutral’ rating and a target price of Rs 285, compared with its market price of Rs 295 in the valuation table, implying a negative 3% potential return.
Macquarie expects Angel One’s revenue to grow at around 10% between FY26 and FY30, well below its estimate of 17-18% CAGR for the broader retail brokerage market. It also sees pressure from lower margins and higher marketing expenditure to retain investors.
“Angel One has a recognised franchise but share losses and lower margin weaken the relative risk-reward,” Macquarie said.
The brokerage’s sensitivity analysis also highlights the impact of regulatory-driven declines in futures and options volumes. Under a hypothetical 20% decline in F&O volumes, Macquarie estimates Angel One’s revenue would fall 10%, while EBITDA and profit after tax would decline 29% and 31%, respectively.
Regulations may hurt volumes before the next growth phase
Macquarie expects recent regulatory changes to create near-term pressure on trading volumes, particularly following the introduction of the Closing Auction System in August 2026.
The brokerage estimates that the disruption from CAS could persist for two quarters as liquidity deepens in the auction, algorithms and trading strategies adjust, and the divergence between cash and derivatives price discovery narrows.
However, Macquarie expects the longer-term capital-market opportunity to remain intact as regulation strengthens investor protection and market stability. The brokerage said India’s market has remained resilient despite around $46 billion of net foreign investor outflows over the past 2.5 years, with systematic investment plan inflows helping offset the impact.
SIPs are creating a more stable domestic liquidity base
Systematic investment plan contributions have become an important source of recurring domestic liquidity. Macquarie said the annual SIP contribution run-rate increased from less than Rs 1 lakh crore in FY19 to around Rs 3.5 lakh crore by FY26.
Monthly SIP inflows rose from around Rs 14,000 crore in April 2023 to consistently above Rs 30,000 crore by early FY26, reaching around Rs 32,100 crore in March 2026.
The brokerage said the growing predictability of SIP flows provides a more durable domestic liquidity base and can help smooth market volatility, particularly when foreign investors are selling.
Macquarie’s capital-market picks and target prices
| Stock | Rating | Target price | Potential return |
| Billionbrains Garage Ventures (Groww) | ‘Outperform’ | Rs 260 | 37% |
| BSE | ‘Outperform’ | Rs 4,000 | 24% |
| Multi Commodity Exchange of India | ‘Outperform’ | Rs 3,820 | 17% |
| National Stock Exchange of India | ‘Outperform’ | Rs 1,965 | 10% |
| Angel One | ‘Neutral’ | Rs 285 | -3% |
Conclusion
Macquarie’s ranking of the five companies is Groww, MCX, BSE, NSE and Angel One. The brokerage’s multi-factor framework assesses companies across growth, profitability, market position, valuation and earnings quality.India’s capital-markets ecosystem is moving from a phase driven primarily by customer and volume growth towards one increasingly shaped by free cash flow and capital allocation.
Disclaimer: This article is based on Macquarie Equity Research’s India Capital Markets: A Powerful $500bn Flywheel report dated September 24, 2026. The ratings, target prices, estimates, potential returns and views cited above are those of Macquarie and may change without notice. Potential returns are based on the brokerage’s target prices and the market prices used in its September 2026 valuation tables and should not be treated as guaranteed returns. This article is for informational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security. Investors should conduct their own research and consult a qualified financial adviser before making investment decisions.